May 1, 2008

Crimson To Acquire South Texas Assets For $65MM

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Crimson Exploration Inc., Houston, (OTCBB: CXPO) plans to acquire interests in four producing gas fields and undeveloped acreage in South Texas from an undisclosed private company for $65 million in cash.

The deal values proved reserves at $2.82 per thousand cubic feet of gas equivalent and production as $9,286 per thousand cubic feet equivalent per day, according to Crimson.

The assets consist of a 25% non-operated working interest in Samano Field in Starr and Hidalgo counties, a 100% operated working interest in North Bob West Field in Zapata County and 100% operated working interests in Brushy Creek and Hope fields in DeWitt County. Crimson will acquire an interest in 137 producing wells more than 16,000 gross acres with these fields. Approximately 56% is operated.

Samano Field (5,600 gross acres) complements Crimson’s Cage Ranch Field assets in Brooks County. Drilling operations could begin as early as the summer. North Bob West Field (8,000 gross acres) is in close proximity to other Crimson properties in Zapata County.

Net production is approximately 7 million cubic feet equivalent per day. Net proved reserves are approximately 23 billion cubic feet equivalent (96% gas, 71% proved developed producing).

Crimson will funded the deal with borrowings from its senior revolving credit facility.

The deal is expected to close by May 30.